Spotify (SPOT) closed the most recent trading day at $441.21, moving -3.03% from the previous trading session. The stock trailed the S&P 500, which registered a daily loss of 0.01%. At the same time, the Dow added 0.14%, and the tech-heavy Nasdaq lost 0.46%.
Shares of the music-streaming service operator witnessed a loss of 11.28% over the previous month, trailing the performance of the Computer and Technology sector with its loss of 2.57%, and the S&P 500's loss of 1.4%.
Analysts and investors alike will be keeping a close eye on the performance of Spotify in its upcoming earnings disclosure. In that report, analysts expect Spotify to post earnings of $3.3 per share. This would mark year-over-year growth of 787.5%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $5.6 billion, up 17.66% from the year-ago period.
SPOT's full-year Zacks Consensus Estimates are calling for earnings of $14.68 per share and revenue of $22.73 billion. These results would represent year-over-year changes of +23.47% and +16.98%, respectively.
Investors should also note any recent changes to analyst estimates for Spotify. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.1% lower within the past month. Spotify is currently sporting a Zacks Rank of #3 (Hold).
With respect to valuation, Spotify is currently being traded at a Forward P/E ratio of 31. This denotes a premium relative to the industry average Forward P/E of 18.07.
It is also worth noting that SPOT currently has a PEG ratio of 1.11. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Internet - Software industry currently had an average PEG ratio of 1.01 as of yesterday's close.
The Internet - Software industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 89, positioning it in the top 37% of all 250+ industries.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.
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Spotify Technology (SPOT): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).